Reversed and Rendered and Opinion Filed February 17, 2017 

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In The 

## Court of Appeals Fifth District of Texas at Dallas
No. 05-16-00348-CV THE CITY OF DALLAS, Appellant V. AL ELLIS, Appellee On Appeal from the 298th Judicial District Court Dallas County, Texas Trial Court Cause No. DC-99-05680-M



### MEMORANDUM OPINION Before Justices Francis, Fillmore, and Stoddart Opinion by Justice Francis The City of Dallas appeals the trial court’s deni al of its motion for scir e facias to revive a dormant judgment against Al Elli s. In two issues, the City a sserts the ruling was error because (1) it established the necessary st atutory requirements to revive the judgment and (2) Ellis’s defenses of limitations and laches do not apply. For reasons set out below, we agree with the City. Accordingly, we reverse the trial court’s order and render judgment granting the City’s motion, thus reviving th e dormant judgment. In 1987, a City employee was injured in an au tomobile accident duri ng the course and scope of his employment as a fi refighter. The City, as a work ers’ compensation self-insurer, paid the employee workers’ compensation benefits. Ellis, an attorney, represented the employee in his personal injury claim against the third-pa rty tortfeasors who caused his injuries. The suit–2– settled. The settlement agreement provided for E llis to resolve the City’s worker’s compensation lien. Ellis was aware of the law in effect at th at time and knew the City had the right to recover the “first money” from the employee’s settlement to offset the amount the City paid to the worker in workers’ compensation benef its. The City, however, was not paid. See Ellis v. City of Dallas , 111 S.W.3d 161, 164–65 (Tex. App.—Eastland 2003, no pet.). The City sued Ellis for conversion of its wo rkers’ compensation lien. Following a trial, a jury found in the City’s favor. On Septembe r 28, 2001, the trial court signed a judgment in accordance with the jury’s verdict awarding the City judgment for $86,926.82 with interest at the rate of 10 percent per annum and taxable cour t costs. On December 28, 2001 the trial court signed a modified final judgment reducing the total awarded to the City to $75,626.09, plus postjudgment interest and court costs. Ellis appealed, and the judgment was affirmed. See id. at 168. Nearly eleven years later, on November 5, 2012, the City filed a motion to revive the judgment by scire facias. The motion, however, mi stakenly sought to revive the September 28, 2001 judgment, not the modified final judgment. In accordance with the City ’s request, the trial court revived the September 28, 2001 judgment. Af ter a writ of execution issued two and a half years later, the City realized it had revived the wrong judgment. Consequently, on July 30, 2015, the City file d its first amended motion to revive judgment by scire facias, this time seeking to re vive the modified final judgment of December 28, 2001. In its motion, the City acknowledged a judgment becomes dormant ten years after rendition of judgment and ordinarily can be revi ved by scire facias within two years from the date the judgment became dormant. See T EX
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. §§ 34.001(a) (execution on dormant judgment); 31.006 (revival of judgment) (West 2015) . But, apparently recognizing that more than two years elapsed between the dorman cy of the modified judgment and the motion for scire facias, the City asse rted section 16.061(a) of the civil practice and–3– remedies code exempted it from th e two-year statute of limitations. See T EX
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. § 16.061(a) (2015). Ellis filed a response in which he did not challenge the City’s statute of limitations assertion; rather, Ellis argued only that laches barred the City’s attempt to revive the judgment. Following a hearing, the tr ial court revived the modified final judgment. Ellis filed a timely motion for reconsiderati on and motion for new trial and, for the first time, argued section 16.061 did not exempt the C ity from the two-year statute of limitations because the underlying claim was based on a subrogation interest belonging to the City’s employee, not the City. Ellis also reasserted his laches defense. After a hearing, the trial court granted Ellis’s motion, vacated its order revivi ng the December 28, 2001 judgment, and ordered that the judgment is not revived and is cons idered dormant and unenforceable for all purposes. The City appealed. In two issues, the City argues the trial c ourt erred by refusing to revive its judgment against Ellis for conversion of th e City’s statutory workers’ comp ensation lien. The City argues it satisfied all statutory requirements, leaving th e trial court without discretion to deny its motion and enjoin the City from enforcing its judgment. The City also argues it cannot be barred from reviving its judgment by either li mitations or laches. We begin with the limitations argument. If a writ of execution is not issued within te n years after the renditi on of a judgment of a court of record, the judgment is dormant and ex ecution may not be issued on the judgment unless it is revived. See T EX
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. § 34.001(a). Ordinarily, a dormant judgment may be revived by scire facias not late r than the second anniversary of the date the judgment becomes dormant. Id . at § 31.006. In determining whether to issue a writ of scire facias reviving a judgment, the trial court sha ll consider the date of the underlying judgment, evidence of any writs of execution issued on the j udgment, and the date of the motion to revive–4– the judgment scire facias. Chen v. Nguyen , No. 05-15-00077-CV, 2016 WL 258786, at *1 (Tex. App.—Dallas Jan. 21, 2016, no pet.) (mem. op.). Here, the City waited more than two years from the time the December 28, 2001 judgment became dormant to file it s motion to revive. Nevertheless, the City argues it is exempt from the two-year limitations period under a ge neral limitation exemption granted to various governmental entities under section 16.061, which provides: A right of action of this stat e or a political subdivision of the state, including . . . an incorporated city . . . is not barred by any of the following sections [of the Texas Civil Practice and Remedies Code]: . . . 31.006 . . . .” T EX
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. § 16.061. As he did in the trial court, Ellis argues section 16.061 does not apply to the circumstances of this case because the City is asserting a subrogation interest in a claim belonging to its employee. As such, he argues, the City’s is not assert ing its own “right of action.” To support his argument, he relies on Harris County v. Carr , 11 S.W.3d 342 (Tex. App.—Houston [1st Dist.] 1999, no pet.) and two cases that followed it, Texas Department of Transportation v. Esquivel , 92 S.W.3d 17 (Tex. App.—El Paso 2002, no pet.), and State of Texas v. Airgas-Mid South, Inc. , 83 S.W.3d 890 (Tex. App.—Texarkana 2002, no pet.).
In Carr , Harris County paid an employee workers’ compensation benefits after he was injured in an automobile accident. 11 S.W.3d at 343. More than three years later, Harris County, on its own behalf and on its employee’s beha lf, sued the driver of the other vehicle for negligence. The defendant asserted the claim wa s barred by limitations a nd laches, and the trial court agreed. Id

. On appeal, the county argued its claim was not barred because it was exempt from the statute of limitations under section 16.061. The c ourt of appeals disagreed, explaining that a workers’ compensation insurer who asserts a subr ogation claim is asserting a claim that belongs–5– to the employee and, regardless of whether the in surer sues in its own name, that claim belongs to the employee. Id . Thus, the court of appeals concl uded the subrogation claim brought by the county against the third-party tortfeasor was not a cause of action belonging to the county that was covered by section 16.061; thus, th e claim was barred by limitations. Id . at 344. Likewise, in Esquivel and Airgas-Mid South , the governmental units sued third-party tortfeasors to recover workers’ compensation payments made to their employees for injuries caused by the tortfeasors’ negligence. Esquivel , 92 S.W.3d at 19; Airgas-Mid South , 83 S.W.3d at 891. The defendants in both cases raised the st atute of limitations, and the governmental units relied on section 16.061 for an exemption. In both cases, the defendants relied on the reasoning
in Carr to conclude 16.061 did not apply, and the courts of appeals agreed. Esquivel , 92 S.W.3d at 23; Airgas-Mid South , 83 S.W.3d at 892. We do not disagree with the general principles of subrogation law set out in Carr , Esquivel , and Airgas-Mid South. Specifically, we agree that wh en a workers’ compensation carrier asserts a subrogated claim against third-part y tortfeasors, the carrier is asserting a claim derivative of the employee’s claim, and in such situ ations, the carrier “stands in the shoes” of the injured employee. But the posture of this case is materially different from Carr and its progeny. Unlike those cases, the City here is not seeking to invoke section 16.061 to avoid the statute of limitations in a suit brought agains t the third-party tortfeasors, wh ere it would clearly “stand in the shoes” of its employee. Moreover, the judgme nt the City seeks to re vive did not arise from such a circumstance and is not one for an employee’ s personal injuries. Ra ther, it is a judgment for conversion, resulting from the City’s suit ag ainst the employee’s attorney Ellis who, once he settled the suit against the third-party tortfeasors, refused to pay the City what it was owed on its workers’ compensation lien. Under these circum stances, we conclude that in attempting to revive the judgment, the City is asserting its own “right of acti on,” not the employee’s, and thus–6– is entitled to the exemption from the statute of limitations provi ded in section 16.061 . Therefore, the City’s action to revive the dorma nt judgment is not barred by limitations. Next, we address the City’s contention that laches does not bar its right to revive and enforce its judgment. Assuming without deciding that laches can apply to bar a City from reviving a judgment owed to it, Ellis failed to sh ow the defense applies in this particular case. Laches is an equitable defense that preven ts a plaintiff from asserting a claim due to delay––“not mere delay but delay that works a disadvantage to another.” Culver v. Pickens, 176 S.W.2d 167, 170–71 (Tex. 1943). It rest s on the theory that because of a delay in the exercise of a legal or equitable right, the defendant woul d be unconscionably prejudiced if the right were exercised. Regent Int’l Hotels, Ltd. v. Las Colinas Hotels Corp , 704 S.W.2d 101, 106 (Tex. App.—Dallas 1985, no writ). Unlike statutes of limita tions, “laches is not . . . a mere matter of time; but principally a question of the inequity of permitting the claim to be enforced. . . .” Condom Sense, Inc. v. Alshalabi , 390 S.W.3d 734, 758 (Tex. App.—Dallas 2012, no pet.) (quoting Holmberg v. Armbrecht , 327 U.S. 392, 396 (1946)). Two e ssential elements must exist for laches to bar a claim: (1) a party’s unreasona ble delay in asserting a legal or equitable right and (2) a good-faith change of position by another to his detriment because of the delay. Rogers v. Ricane Enters., Inc. , 772 S.W.2d 76, 80 (Tex. 1989). In this case, Ellis alleged he was harmed by the City’s delay in reviving its judgment because (1) post-judgment interest has more than tripled the amount of the original judgment and (2) he is no longer eligible to se rve on City boards and commissions. In his affidavit, Ellis asserts he “always in tended” to pay the City for its subrogation interest. He relies on his conduct before the judg ment was rendered against him in that he sent–7– the City a check in the amount he believed they agreed upon, but the City rejected the payment. 1 He asserts his delay in paying the final judgmen t was due to his “true and good faith belief” the City would “settle for less than th e judgment.” This belief, he a sserts, was based on his “prior experiences in my clients’ litigat ion with the City and on represen tations of City employees that it would settle the claim.” Ellis further asserts he “held the impression” the City was “willing to negotiate a settlement” of the final judgment un til March 2015, when the City “first informed” him it would not negotiate a settlement because it believed it was precluded by law from doing so. Ellis asserts that had the City informed him settlement was impossible “from the beginning,” he would have paid the judgment. Ellis then asserted before this “incident,” he was very active in the Dallas community, but as a result of the conflict with the City, he is no longer eligible to serve on boards and commissions. In addition, he asserted that his “credibility and reputation, both personal and professional, have been damaged.” Finally, he asserted the loss of civi c opportunities and injury to his reputation is “severe.” Having reviewed Ellis’s affidavit, we concl ude he failed to present any evidence that he had a good faith, detrimental change in his position in reliance on the City’s delay in asserting its rights. The judgment has tripled because post-judgment interest has accrued; Ellis cannot sit on City boards and commissions because he owes the City money. Ellis knew of the judgment against him and that it was accruing interest. He also knew he had an obligation to pay the judgment. To the extent Ellis argues he relie d on pre-judgment statements by the City that it would settle the claim for less than owed, that issue was determined against him in the

1 We note that in the underlying lawsuit that resulted in the conve rsion judgment, Ellis testified he and the City’s claims mana ger had reached an agreement to settle th e claim for less than the City was owed. The cl aims manager, however, testified he never settl ed City’s workers’ compensation liens for less than 100 percen t (minus up to one-third for attorney’s f ees) because the fundin g for the City’s wor kers’ compensation payments came from tax dollars. See Ellis , 111 S.W.3d at 165. When Ellis sent the City a check for less than the fu ll amount owed, the City returned it. Id . The jury ultimately decided this fact question in the City’s favor when it answer ed “No” to the question asking whether the City agreed to accept a lesser sum than ow ed as a complete settlement of its workers’ compensation lien. Id . at 163.–8– underlying suit. Moreover, Ellis has presented no evidence the City made or accepted any offer to settle for less than what was owed afte r the judgment was rendered, much less since the judgment became dormant, or, if such an offer or acceptance was made, when it was made. To the extent he believed there was a possibility the City would accept less than the full amount of the judgment after it was rendered, a nd in spite of the fact the part ies had litigated the very issue of whether the City had agreed to settle for less, it was Ellis’s obligation to pursue a course of action to attempt to achieve that result; the City was under no obligation to accept less. Ellis has produced no evidence of any such efforts; rather, he relies on his “impression” that the City was “willing to negotiate.” The increase in the amoun t owed on the judgment a nd Ellis’s inability to participate in certain civic activities was due solely to his failure to pay a judgment he indisputably owed. Having reviewed the record, we conclude Ellis failed to produce evidence that he had a good-faith change of position to hi s detriment because of the delay. We further conclude the City established the necessary stat utory requirements to revi ve the judgment. We sustain both issues. We reverse the trial court’s order granting Ellis’s motion for reconsideration and motion for new trial, vacating its prior order revivi ng the judgment, and ordering the judgment not revived and dormant. We render judgment granting the City’s motion for scire facias, thus reviving the dormant judgment. See Cadle Co. v. Rollins , No. 01-09-00165-CV, 2010 WL 670561, at *1 (Tex. App.—Houston [1st Dist.] Feb. 25, 2010, no pet.) (mem. op.).

160348F.P05 /Molly Francis/ MOLLY FRANCIS JUSTICE–9– 

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Court of Appeals Fifth District of Texas at Dallas JUDGMENT
THE CITY OF DALLAS, Appellant
No. 05-16-00348-CV V. AL ELLIS, Appellee On Appeal from the 298th Judicial District Court, Dallas County, Texas Trial Court Cause No. DC-99-05680-M. Opinion delivered by Justice Francis; Justices Fillmore and Stoddart participating. In accordance with this Court’s opinion of this date, the trial court’s Order on Defendant’s Motion for Reconsidera tion and Motion for New Trial is REVERSED and judgment is RENDERED granting the City's motion for scir e facias and reviving the December 28, 2001 judgment. It is ORDERED that appellant City of Dallas rec over its costs of this appeal from appellee Al Ellis.
Judgment entered February 17, 2017.